Choosing a Collection Agency

The result of today’s rising co-payments and deductibles is increased accounts-receivable for medical practices.  Although the first priority is always treating patients, collecting payment for services keeps practices in business.  Consequently, many doctors use collection agencies.

When considering a collection agency, ask for references; time-tested references are ideal.  Try to determine if the contact person is knowledgeable, reliable and available for training and consultation. 

Here are a  few more things to consider:

Methods the agency uses to collect the debts:

• How many telephone calls are made per account?
• What types of letters are sent to patients?
• What kinds of reports will you receive?
• At what point does the debt go on the patient’s credit report?

Agency fee structure:

• How will you receive the collected funds (I.E., gross or net)?
• Do fees increase based on specific phases of collection?
• Can you cancel an account at any time?

Options if agency fails to collect the debt

• If you want to file suit, do you have to use their attorney or can you use your own?

Is the agency up-to-date?

• Do they have the means to do “skip tracing” and find people who have moved?
• Are they licensed, insured, and bonded?

What are your thoughts on using a collection agency for your practice?